Arsenal manager Arsene Wenger has hinted that the club is ready to transform its transfer policy, claiming he would be happy to sanction a £40 million signing next summer in a bid to revive his team.

Arsene Wenger's fortunes in the transfer market appear set to change

Wenger has long been criticised for failing to spend in the transfer market, and has been accused of prioritising profit on the balance sheet ahead of success on the field. However, he has suggested his financial armoury is now fully loaded as he looks to defy his critics with a summer of spending.

Rumours that Wenger will be handed a £70 million transfer war chest have been circulating and he certainly seems to be ready to change his own approach after the most turbulent week of his 16-year reign as Arsenal boss, with FA Cup defeat against Blackburn last weekend followed up by a Champions League humbling against Bayern Munich on Tuesday night.

Now Wenger seems ready to fight back, and when asked whether he would consider paying £40 million to sign a player like Atletico Madrid star Radamel Falcao next summer, the Arsenal boss was quick to answer in the affirmative.

"We can do it and if we can afford it, we will not say no," he said of the prospect of shattering Arsenal’s transfer record. "I am not reluctant to spend and if we find tomorrow a player of top, top, top quality, we will take him.

"First of all, we only had money recently (after Emirates Stadium move). Secondly, in England there is a way of thinking that every problem is sorted out just by spending money but that’s not always the case. If it was like that, the same teams would win the Champions League every year.

"I believe that the problem today is not the money, it’s to find the talent that strengthens your team. We went out to spend money at Christmas but we didn’t find the players."

Wenger went on to suggest Arsenal’s inability to hold onto their star players is the primary reason why standards have slipped, with the Gunners chief sympathising with supporters who have been forced to pay rising ticket prices at a time when success on the field has been elusive.

However, Wenger has stated that the need to repay the debts incurred by the move to Emirates Stadium and what he describes as the "unfair competition" provided by the arrivals of Chelsea and Manchester City at the top of the Premier League in recent years has tipped the balance of power in the Premier League against his club.

"I think what angered more our fans is that we lost the players we educated and that was difficult to swallow," he stated. "That is what we have to change and we are in a position to do that now.

"There were many major issues we were fighting to keep our best players. You can only keep your best players by paying the wages of the market. To pay the wages of the market we have to put the ticket prices up and then the fans turn against you, but that was the consequence of the unfair competition that we faced."

Amid the current Arsenal slump, the fear among some Arsenal fans has been that star man Jack Wilshere will be next to head for exit door that saw the likes of Cesc Fabregas and Robin van Persie pass through it in recent years, but Wenger is convinced the commitment of his current talisman to the Arsenal cause is cast in stone.

"Jack has just extended his contract," added Wenger. "I believe in the longer term Wilshere will be the leader of this club and lead the club to trophies. That’s what it is about as well for the great players and we have to make sure they all stay here."